Game Group considers shock stock market return

Henry Jackson and Game Group's management team considering an IPO 18 months
after OpCapita bought the chain back out of administration

The digital revolution in music and books, which caused such ructions on the high street, saw the price of albums and book fall. This has yet to happen in games. Until it does, the outlook for Game Group is uncertain.Photo: PA

Video games specialist Game Group is eyeing a £200 million return to the stock market 18 months after controversial financier Henry Jackson bought the business out of administration.

Sources told the Daily Telegraph that an IPO was one of the options under consideration as investors led by the American tycoon seek an exit from the chain.

The speculation came as Game prepared for the one of the biggest ever weeks in the video games market as next-generation games consoles Xbox One and PS4 hit the shelves.

The Xbox One, whose games include "Dead Rising 3", goes on sale in stores at midnight with the PS4 set to follow next Friday. Game has taken four times as many pre-orders for the both consoles than their predecesors, the Xbox 360 and PlayStation 3.

Insiders said Mr Jackson, widely attacked last year for the collapse of the Comet electricals chain, felt the time was right to sell Game on given its solid performance this year and the big boost to revenue likely to come from the new consoles.

Insiders close to Game insisted a final decision on a float would only be taken by Martyn Gibbs, chief executive, and his management team. But one industry source said: ""Henry's looking to sell. He's talking about a float at £100 million to £200 million." Another said: "It was always the plan for Henry to come back out just as the new consoles launched."

Game went into administration in March 2012, triggering the closure of 277 stores. Henry Jackson's OpCapita vehicle took it over at the start of April last year and there are now 318 sites across the UK.

Profits hit £15 million in 2011-2012, the last set of published figures, and the chain is targeting £40 million in the current 2013-2014 financial year.

According to Companies House, Game is owned by a vehicle called Capitex Holdings, whose directors are OpCapita founder Henry Jackson and Jim Shinehouse, both of whom were directors at Comet’s parent company.

The latest accounts for Capitex show it is owed £103m by Game and has collected millions of pounds from the retailer in interest and “monitoring fees”.

OpCapita is thought to have recouped nearly £120 million from Comet, despite the chain's collapse last year which led to 6,000 job cuts. OpCapita was the main creditor at Comet as well the owner, after picking up the right to the company's debt as part of the acquisition.

Ben Parfitt, associate editor of games magazine MCV said Game had impressed the industry with its recovery in the past year. He said: "They were in suct a terrible situation but they seem to be doing really well.

"They have opened around 12 new stores in the last couple of months and crucially the thing they are doing differently this time is they seem to have suppliers on board. It seems to be a happy ship over there."